Is that a "clear win"? Good lord, whatever happens, the NYT will spin it as a win for Obama. I thought his number was $250,000 for couples, and now, it's way up at $450,000. That should be called a clear compromise. How hard it must be for the Republicans to compromise, when even clear compromises are declared clear wins for the other side.

All is Obama. Yesterday's Yahoo headline and story correctly spoke of Biden and senate leaders hashing out a deal. The accompanying photo - the sage and blissfull countenance of Obama. I wanted to shout "you did nothing."

And yet nothing has changed except those that are being targeted for punishment now know who they are. They will now engage in behavior that will make them less of a target.The healthcare tax will all on everyone. Well 47% of those of us actually paying taxes. And they too will engage in behavior to lessen that burden , if they can.There is nothing in this that promotes economic growth.In fact. Just the opposite.

Why are the single and couple thresholds only $50K apart? What is the political calculus here? Is it that 800 for couples is too high for the demogogues, or is it that 225 would snag too many dem voting singles?

From what I'm seeing, the GOP conservatives believe that this deal represents a caving in by the GOP leadership--meaning a victory for Obama.

And so they oppose this deal--just like they opposed every other attempt to strike a deal going all the way back to 2011.

The GOP conservatives have a perfect track record: Every deal they refused to go along with--the 2011 deal that Obama was negotiating, Boehner's Plan B--has been followed by a deal that was even worse.

From what I'm seeing, the GOP conservatives believe that this deal represents a caving in by the GOP leadership--meaning a victory for Obama.

And so they oppose this deal--just like they opposed every other attempt to strike a deal going all the way back to 2011.

The GOP conservatives have a perfect track record: Every deal they refused to go along with--the 2011 deal that Obama was negotiating, Boehner's Plan B--has been followed by a deal that was even worse.

Rusty, I totes understood what they were trying to say. But objected to the verb "gum". As if they'd poured molasses or honey in the gears. Rather than use the aphorism correctly, the broke it apart and couldn't think of a verb that suggested what happens when hardened steel is tossed into meshing and moving gears. Seizing? No, that's the intransitive sense. Doesn't work. Maybe flippping it:

Old:

However, new wrenches were gumming up the machinery.

New:

However, new wrenches were causing machinery to seize.

Ahhhh..."jamming". That'd work. And it's so close to gumming. Maybe that's what they meant? Have to delete "up" of course.

It looks like pm is right. The clear win was that the cons did give in on some taxes for folks at the 250M level. How could that not be considered a clear win.

Likewise, the cons had a clear win because the payroll tax is going up. Taxes on non-job-creators are good. At least they're good for cons when the revenues pile up surpluses that can be traded for IOUs, and then the funds can pay for other budget items, therefore allowing more tax cuts for the job creators.

The con argument is very persuasive: Job Creators--Regressive taxes (e.g. taxes that start at--Takers--dollar one and go to zero a bit--Job Creators--above 100 are good. JOB CREATORS!!11!!!!!1!!!

I predict that in coming years, the government will take control over everyone's 401K. They won't confiscate the money, but spend the money, and write IOU's in it's place. Just like they're doing with Social Security money. They have no choice because of the deficts they are running. It's the only cash stash left.

TML said...Rusty, I totes understood what they were trying to say. But objected to the verb "gum". As if they'd poured molasses or honey in the gears. Rather than use the aphorism correctly, the broke it apart and couldn't think of a verb that suggested what happens when hardened steel is tossed into meshing and moving gears. Seizing? No, that's the intransitive sense. Doesn't work. Maybe flippping it:

Old:

However, new wrenches were gumming up the machinery.

New:

However, new wrenches were causing machinery to seize.

Ahhhh..."jamming". That'd work. And it's so close to gumming. Maybe that's what they meant? Have to delete "up" of course.

Yeah. Missed that.Gumming up the works would imply sabotage or neglect, I suppose."sabotage"Ha! A wooden shoe in the works!In any event. Economically we're still screwed.

All is proceeding as I expected. An ex-post-facto 'last minute deal', arrived at *after* the legal last minute, mostly providing no meaningful solution, taking more from the folks actually working, giving more to the folks not working, and (to paraphrase the WSJ) with the expected result being to keep economic growth rate depressed.

I blame the credulous voters who elected this crew of clowns to congress, loaned them the power, and did not monitor performance.

It is simply insane to expect the 'leadership' who created this problem to arrive at a meaningful solution.

Does anyone believe that McConnell had a sudden inspiration, called Joe Biden, and the two of them then "led the negotiations to avoid the fiscal cliff," independent of and ignoring the President, the Senate Majority Leader, and the House?

And of course, the House has not been heard from yet. There are rumors John Boehner has not been able to get a majority of his caucus to go along with this.So, he can block a vote, or he can let the vote go ahead and pass "in a bi-partisan way."This will be another great "victory" for Obama in Waahington politics, but likely to cause a great deal of disgust around the country - and not just from Republicans.

So far, this has degenerated into a fight over symbols and party politics, and nothing has been done to solve the real problems seeeen from either side.

The facts are that the "compromise" plan voted by the Senate last night includes $1 of spending reduction for each $41 of new tax revenue. It ADDS at least $7.9 TRILLION to the national debt.

How is this in any way good for America (regardless of your political affiliation)?

Out of control spending is not halted. The federal government will continue its out-of-control spending, borrowing and money printing. There is no federal budget for the fifth consecutive year, even though law requires that the Senate introduce a budget bill annually.

This bill solved nothing. It merely made America's near-term economic collapse more inevitable.

Taxes on all Americans went up at midnight to the Clinton rates, the Obama tax rates expired. When and if the republican House passes the Biden / McConnell senate deal, the republicans will be voting for a tax cut for all, but those in the "evil" 1%.Obama wins and loses on the $400,000 limit, he wanted $250,000 to define "the rich". I wonder how NE pols are going to explain this to their "rich" continuants in those blue states.

He got a marginal tax rate increase, without having to make any real concessions on spending. Democrats deserve to spike the football today.

His next order of economic business will be to find a way to make additional transfer payments to California to help them avoid going t.u. in the next 12 months. Expect to hear much more about stimulus and infrastructure spending, while Republicans make additional concessions to pray the Democrats go easy on them in the midterms.

Where's the beef? Where are the spending cuts? Spending cuts? There are no spending cuts in a socialist state. Which is to say we have been recaptured by the European elite - in the guise of our own home grown Europeanized elite - from which the first Americans fled. It truly is the death of the last best hope.

ritmoThe politics can be spun to the determent of the republicans, no doubt, but that doesn't translate in to good policy. Do you really think the republican base is going to evacuate over this, considering the alternative? Besides this was all theater, wait for what's coming down the pike, the markets won't be able to ignore that.

The Republicans are dividing more rapidly than Grover Norquist can say "pledge". It occurred in 2006 and 2008. What 2010 represents is too soon to tell. But seeing as how their "retention" of the House came with a half million vote deficit to what their opposition got, that's not a very resounding victory for them.

The division is taking place because some Republicans actually have enough brains to recognize the lowered popularity that this represents and the toxicity to their "brand" of fixating on the philosophy of rape and believing that the 1980s were a magical decade of political-economic transcendence whose policies should be frozen into all governments for all time whatever the the situation.

Thanks Bunny. It's good to know that you care and I don't doubt that you're a decent financial advisor/planner. But given your previous predictions of race wars I think I'll discard the more apocalyptic fascinations of your ideas for what the future holds.

It's ok. That's what your sect was saying 80 years ago to FDR after what the Republican Coolidge and Hoover administrations did.

It doesn't play out all that favorably for conservative politics. When do you think they will learn, and stop with the intentional boom-and-bigger-bust incentives and the laziness when it comes to any answers for anyone but themselves?

RITMOYou do know there have been Gyno books by doctors that have theorized and argued this? They have since been proven wrong, science theories get proven wrong every day. I can only speak for Atkins, he was wrong on the science, it wasn't based on his belief system. He won a three way primary against two opponents, that both out polled Sen. McCaskill, she spent over a million dollars running Atkins primary adverts. Does that mean the Senator supports Atkins' bad rape science? No, it means she is a scumbag.

MCTRIUMPH (I guess I'll reciprocate the screaming caps form of address. Perhaps it means urgency rather than rudeness):

I'll try digesting your comment in little pieces - which shouldn't be hard given how short it already is. But the link was to the electoral fate of seven, seven, Republican candidates who happened to give a lot of comment to a topic that most Americans seem to have made up their moral minds about.

Perhaps there is some legitimate, interesting, if completely removed and esoteric point in whatever they were all trying to say. But I think the conclusion that Americans made up their minds about the utility and practical decency of any of it is hard to deny.

I'll try to argue cogently with anyone who cares to reciprocate. Sometimes I'll make strident points. Sometimes more calm ones. And none of this guarantees who I'll agree with or who I won't. It's just how reasoned discussions go.

This has nothing to do with policy, deficits, spending, taxes, or anything else except: the 2014 election, and the BIG DEAL, the 2016 election.

Obama wants Republicans either (1) on record supporting increased taxes; or (2) publicly held responsible for the coming recession. He may get both wishes.

House Republicans who vote for higher taxes risk being challenged in their primaries, and the primary winner, weakened, risks losing to the Democrat in competitive districts. If this happens in enough districts, the Republicans lose control of the House (and they will have no chance of gaining control of the Senate), so Obama will have a free hand in his last two years in office.

If House Republicans don't vote for higher taxes, and the economy goes south, as it likely will REGARDLESS OF ALL THIS POSTURING ON THE CLIFF, the Democrats can count on the press to blame the Republicans, not Obama, for the recession, and they will be punished in the 2014 election. Again, Obama will have a free hand in his last two years in office.

The same considerations apply to the debt ceiling issue and all spending issues that are coming up in the next few months.

I really fear that no one on the Republican side has the foresight to avoid the traps Obama is setting.

This has nothing to do with policy, deficits, spending, taxes, or anything else except: the 2014 election, and the BIG DEAL, the 2016 election.

Obama wants Republicans either (1) on record supporting increased taxes; or (2) publicly held responsible for the coming recession. He may get both wishes.

House Republicans who vote for higher taxes risk being challenged in their primaries, and the primary winner, weakened, risks losing to the Democrat in competitive districts. If this happens in enough districts, the Republicans lose control of the House (and they will have no chance of gaining control of the Senate), so Obama will have a free hand in his last two years in office.

If House Republicans don't vote for higher taxes, and the economy goes south, as it likely will REGARDLESS OF ALL THIS POSTURING ON THE CLIFF, the Democrats can count on the press to blame the Republicans, not Obama, for the recession, and they will be punished in the 2014 election. Again, Obama will have a free hand in his last two years in office.

The same considerations apply to the debt ceiling issue and all spending issues that are coming up in the next few months.

I really fear that no one on the Republican side has the foresight to avoid the traps Obama is setting.

This compromise does not address a progressive demand for instant gratification: material, physical, and ego.

Rusty:

The most productive, whether through legitimate or illegitimate means, will discover or manufacture a way around this nonsense. The least productive, whether by chance or choice, will discover a war around this nonsense. The moderately productive, the middle class, will compensate for this nonsense through increased "productivity" and suffering progressive dysfunction. Redistributive change is a tax on the moderately productive's labor and life. An empowered middle class is an anathema to left-wing regimes.

garage mahal said...Three more fiscal cliffs crises over the next 3 months: debt ceiling, sequester, continuing resolution. What an awesome way to run a government!

You're right; it's ridiculous.

And it all happens b/c the president has never submitted a budget proposal that recognizes the debt problem at all, and the Senate refuses to negotiate w/ the House to send a coherent budget to the president.

The House is performing its constitutional duty. The Senate and the president are not.

It seems clear that this president prefers to operate w/o a budget, precisely b/c of the opportunities for recurring crises that give him the opportunity to score cheap political points.

Why, exactly, is this guy still in campaign mode? Doesn't that seem strange?

Point well taken, Ritmo. But you also know that projected SS and Medicare--especially Medicare--spending grow at a much faster rate than projected revenues, which is what the concern about deficits is primarily about.

It's a joke either way. I don't know anyone who makes over $200,000 a year who doesn't have an accountant/adviser/lawyer whose purpose is to keep that income out of the government's pockets. It's all dumbshow until the crash. You'd have to be insane to think otherwise.

There are serious ways that the president's discussed of bringing down the cost of Medicare. Also, the ACA brings down the overall cost-curve of health care, which will help the American economy.

Which brings us to the other point: When will Republicans ever agree to cutting from the $700 billion of defense spending that dwarfs China's $89 b? And the next eight on the list are the U.K., France, Japan, Russia (at $53 b), Saudi Arabia, Germany, India and Brazil (in decreasing size of defense budgets all the way down to Brazil's $37 b). The expenditures of actual or potential rivals I've listed.

When, Chip?

Yes, we have a spending problem. A huge spending problem. A $700 billion spending problem.

Are Republicans just completely against the idea of ever having allies abroad? What the hell gives with this kind of a budget?

When will Republicans ever agree to cutting from the $700 billion of defense spending...

I don't know much about military spending, but I'm certainly inclined to question why we spend so much. I will say that to the extent that we spend a lot in order to substitute capital for labor, it could be money well spent. But I agree that it's hard to see why we have to spend so much more than anyone else.

As for Medicare costs, you and I have already debated the extent to which cost savings are going to result from OCare. Going beyond that, I'll simply say that there are only two basic ways to reduce future Medicare spending: expand the supply of health-care providers (e.g., making it easier for entry of new hospitals) or ration health care by non-price means.

I'll simply say that there are only two basic ways to reduce future Medicare spending: expand the supply of health-care providers (e.g., making it easier for entry of new hospitals)

FYI - One of the biggest proponents of ACA were the hospitals, since they saw a much greater influx of the pool of clients and business to grow off of. This, in turn, translates into more efficient operations as the growth in customers gives them the scale to treat each one at less cost. Ultimately, it's a very virtuous cycle. Don't forget the price of our inefficient deliver-of-care system relative to every other modern country. People want to justify why we spend so much more per capita and get so little out (comparatively) in return, but ultimately, those numbers can't be denied.

or ration health care by non-price means.

Your first point provides more meat to address. But the previous system of rationing by the means of how healthy (or even foresighted) your customer is wasn't moral. We've done away with the pre-existing exclusions and the rationing they amounted to, with or without the bipartisan support the Republicans promised us that such measures would have enjoyed.

There will be a "rationing", I suppose you could say, of sorts, occurring with the amount devoted to marketing. But once the exchanges are implemented, along with better baseline coverage standards, the amount that insurance companies put into marketing won't need to be as great anyway.

This, in turn, translates into more efficient operations as the growth in customers gives them the scale to treat each one at less cost. Ultimately, it's a very virtuous cycle.

I realize that this argument is made by some serious people, but it's fallacious nevertheless.

The argument confuses external and internal scale effects. If there were such an internal scale effect, hospitals would cut their prices in order to attain the scale of operation that would generate the lower costs. Only external scale effects (i.e., an increase in the number of patients at other hospitals lowers the costs of any particular hospital) have the impact you describe--which is not a "cycle", btw. The standard example of an external effect is that of a rail line that is extended to a new area when the volume of potential shipments gets large enough. I don't know of any such examples w.r.t. hospitals.

The related confusion b/w the average costs and the marginal costs of hospitals has resulted in the preposterous "certificate of need" requirement for building a new hospital. The premise is that increased availability of MRIs makes each MRI more expensive--which is patently ridiculous. It's one of the causes of rising health-care costs, as supply does not expand very much in the face of higher demand.

Explain, in economic terms, why countries with better access to coverage and better outcomes spend significantly less per capita than we do and why that is a bad thing.

Or else I guess we can watch the sputtering vulgarian "Jay" reveal how much of a "pussy" "fuckhead" he is while cowering in fear of how the only potentially significant military rival of China will somehow squash us with their $89 billion defense budget.

Thanks for the partisan report from a Senate minority committee that looks at projected future outlays while ignoring future revenue, St. Croix. That's sure to illuminate the discussion!

Okay. Here is what the government is saying about our future obligations.

As of the most recent Trustees' report in April, the net present value of the unfunded liability of Medicare was $42.8 trillion. The comparable balance sheet liability for Social Security is $20.5 trillion.

So the government is acknowledging $63 trillion in unfunded liabilities, Ritmo. And, as Chip points out, the government has severely underestimated Medicare costs in the past.

Why aren't these horrible numbers a part of the debate? Because the government keeps this debt off the books!

Since liberals like you are suspicious of corporations, and think we have to keep an eye on them, corporations are required to keep all their debts on their balance sheet.

Governments, on the other hand, require no accountability from themselves. So they really do not talk about all our future debts.

Explain, in economic terms, why countries with better access to coverage and better outcomes spend significantly less per capita than we do and why that is a bad thing.

I disagree w/ your factual premises, for reasons I've stated before. The effectiveness of a health-care system is properly measured not by average life expectancy but by life expectancy conditional on being sick. By that measure, the US clearly has the best health-care system in the world.

I see no reason to emulate other countries when the ones that have single-payer are moving away from it and the two-tiered systems that other countries have don't seem politically feasible in a country obsessed w/ "equality".

By that measure, the US clearly has the best health-care system in the world.

By that measure (and I'm not sure where you got your stat) the U.S. also does the best job at making its population sick in the first place.

I think there is an inherent conflict in a society that separates the value in the prevention of illness from the equation. Please find me a physician or any HCP who believes that a pound of prevention is worth an ounce of cure.

Ritmo, I think that studies have pretty much rejected the hypothesis that more preventive practices would improve health outcomes.

One reason why life expectancy numbers aren't better in the US. I believe, is that we have a lot more homicides and motor vehicle deaths per capita than other countries (but I'm too lazy to source these things today, as I'm still recovering from last night).

I don't give a shit about people who are uninsured b/c they choose not to buy catastrophic coverage. Before OCare, that stuff was pretty cheap.

I do care about people w/ pre-existing conditions who lose their insurance b/c they lose their jobs. That's why I'm in favor of the kinds of "high-risk pools" that something like 37 states operated pre-OCare. I wouldn't even object to establishing a federal high-risk pool.

These are things that are easy to do and don't have the considerable downside of OCare.

I'm sorry there's not a nicer way to say this, but: What bullshit you speak of.

Oh shock, the silly fuckhead reveals her ignorance yet again.

Only 20 percent of those regularly used preventive measures are “cost saving,” reducing costs while improving the quality of health, the research found. The rest tend to buy improved health care but do so at a cost. The chart below maps out how much we need to invest in preventive care to gain one additional quality-adjusted life year, or QALY, a standard public health measure that captures both improved longevity as well as higher quality of life:

Do you happen to have reliable stats showing the breakdown of the uninsured in terms of age and health status? I've never seen one, but the very goddam premise that mandatory insurance would reduce premiums was based on the idea that healthy people weren't buying coverage.

Chip - "Jay" is bringing needed sanity, civility and reason to the political dialogue you seek. Please enjoy its company.

BTW, it seems to represent a combination between a barbarian and a troll. I say one should just choose a single pre-modern, Middle Earth persona and go with it. Trying for combinations between the two doesn't work very well.

Wrong. I know for a fact that in 2008 a single male in his late 20s...

Well, Chip, I'm sure that "Jay" will agree with this (not talking about twenties but forties or fifties, but whatever) without even looking it up and as we all know he is just the sort of spokesperson for taking conservative ideas seriously that your side needs.

Please make sure to take awful good care of it, and provide it with a bowl of kibble and water at regular intervals, and located within the radius provided by the chain you keep it tethered to.

As Obama and Bernanke rush pell mell towards a Weimar Reality-Based Community, I'd like to recommend that everyone head to their nearest Home Depot (or Lowe's, as the case may be) and stock up on wheelbarrows to carry the Reichsmarks, er, dollars you will need to buy a loaf of bread when the hyperinflation hits.

> Thanks for the partisan report from a Senate minority committee that looks at projected future outlays while ignoring future revenue, St. Croix

The unfunded liabilities are liabilities that we've already incurred. Presumably we'll continue to promise folks SS, medicare and the like. Even if future revenues cover those future promises, we're still short the money to pay the current unfunded liabilities.

If we stop promising folks SS, medicare, and the like, we'll still need revenues to pay for those promises.

As Samuleson said, SS is a ponzi scheme. It works as long as there are enough suckers coming in the bottom. Unfortunately, "enough" is growing faster than the actual growth in suckers.

I am still troubled as to why this is being seen as a huge Democrat victory and Republican defeat. There were $3 trillion in expiring tax cuts on the table. In 2001, democrats opposed all these cuts. They were expiring only because Republicans never had the votes to pass them to begin with. Now today, Democrats support 80% of them... but yet that is somehow a republican defeat? Obviously everything is relative. But if you look at the long game. Republicans have clearly won the tax war began by Reagan in the 1980s.

With the new permanent tax rates, the feds will be lucky to get 19% GDP in revenue. How is that a victory for Democrats? You can't sustain a welfare state on 19% GDP revenue. Moreover, the wealthy tax payers will soon enough figure out how to defer and avoid the higher tax rate.

If you want a permanent welfare state you have to tax the middle class more.

The lopsided House vote is what makes it a clear win for Obama. If the majority of the majority had liked the deal enough to vote for it, then I would call it a more even compromise. Clearly the House GOPers did NOT feel like it contained enough for them to call it a compromise.